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Bill Gates investment fund will partner with Vinik on Channelside

Lightning owner Jeff Vinik, right, is partnering with an investment fund controlled by Microsoft founder Bill Gates, left, to develop a master plan for 24 acres Vinik owns around Amalie Arena. [AP photo, WILL VRAGOVIC | Times]
Published Sep. 26, 2014

TAMPA — Bill Gates' riches will help fuel Jeff Vinik's vision.

An investment fund controlled by Microsoft's billionaire founder will help finance the Tampa Bay Lightning owner's ambitious plan to build a massive entertainment, office, residential and retail district around the Amalie Arena.

"This has the potential to be a billion-dollar development," said Vinik's top lieutenant, Tod Leiweke, during a 90-minute interview at the arena Thursday.

Having one of the world's richest men put his money behind Vinik's project sends an unprecedented message about Tampa's potential to investors nationwide, Mayor Bob Buckhorn said.

Nothing else is "even close," Buckhorn said. "This will put an exclamation point on the story we've been telling."

Leiweke would not say what percentage of the 24-acre project that Gates' fund, Cascade Investment LLC, would finance but said Vinik will remain in charge.

"Jeff is the lead on this — full stop," Leiweke said. Still, he said, Cascade's involvement "does change things . . . If they're interested in this, it's a really good sign."

Vinik, a hedge fund investor whose net worth was estimated in 2013 at $500 million, bought the Lightning and the lease to the team's home arena in 2010.

He has since amassed 24 acres near Amalie Arena and bought the Channelside Bay Plaza shopping center.

And there are signs that he has yet to make a still-bigger purchase in the area.

That would be the Marriott Waterside Hotel & Marina, which sits between the arena and the Tampa Convention Center.

Buckhorn has said he has talked to Vinik's development team about its desire to buy the 719-room Marriott. Also, a newly formed company has asked the city for information about the hotel in advance of a purchase.

Leiweke declined to comment. Likewise, he would not say whether the master plan would include space for a new Tampa Bay Rays baseball stadium.

"It's presumptuous to weigh in," he said.

Vinik's development team plans to unveil at least the first phase of the master plan before the end of the year. It needs to be a balanced plan, Leiweke said, with scenic places to walk, good ways to get around, places to eat and a sense of "a place that has a soul and a spirit."

Along with residences, hotels, commercial space, restaurants and entertainment venues, "we hope there's going to be education and health care," Leiweke said.

Those last two categories could be covered by the University of South Florida, which is exploring the idea of building its new medical school in downtown Tampa.

Cascade Investment will be a purely "institutional" investor that is not seeking a high-profile public role in the project, Leiweke said.

"I think the cool thing about Cascade is they've taken a leap of faith," he said.

Through Cascade, Gates owns several major hotels, including the Ritz-Carlton in San Francisco, and Four Seasons properties in Houston and Atlanta.

In addition to the hotels, Cascade, based in the Seattle suburb of Kirkland, has more than $24 billion worth of shares in companies such as AutoNation and the Canadian National Railway Co., according to a recent Wall Street Journal story.

Cascade and the rest of Gates' investments are managed by 54-year-old Michael Larson, who is credited with increasing the Microsoft founder's net worth from $5 billion to about $82 billion over the past 20 years, the Journal reported. Gates has said Larson is the reason he sleeps well at night.

Buckhorn said he went to the arena in the spring to meet with Larson to "give him a sense of where we're going as a community and that sense of excitement and passion I talk about."

A former bond fund manager, Larson also oversees the Bill & Melinda Gates Foundation's $41 billion endowment. In 2009, the foundation gave Hillsborough County schools a seven-year, $100 million grant to help reform teaching, evaluations and pay.

There's no connection between the Gates Foundation's grant and Vinik's partnership with Cascade, Leiweke said.

As part of the master plan, Vinik's group plans to build a new 400-room hotel on a parking lot just west of the arena.

Across the street, the Marriott Waterside is "a landmark property'' whose "proximity to the convention center makes it one of the most attractive and financially successful properties in the region,'' said Lou Plasencia, whose Tampa-based Plasencia Group is one of the nation's top hospitality industry consulting firms.

"Given what Mr. Vinik is supposedly contemplating for the Channelside district, I would think it would become even more valuable in the near term,'' said Plasencia, who couldn't comment on whether his firm was involved in any transaction.

The new hotel would be expected to create more opportunity for the convention center and more activity on the street, with up to 170,000 square feet of meeting space, and shopping, cafes or offices on the ground floor.

Vinik also has hired former Trammell Crow Co. executive Bob Abberger to be the managing director of development for the master plan and its implementation.

Before joining Vinik's Strategic Property Partners, Abberger, 59, ran Trammell Crow's Florida operations for 18 years, with a primary focus on Tampa.

"This is a unique opportunity to have a total alignment of interests with somebody that has a grand vision, a passion that I share, to do something in Tampa that will have a long-term legacy," said Abberger, who has worked with Vinik's development team for about a year.

Asked about the biggest challenges ahead, Abberger paused.

"Meeting Jeff's aggressive time frames to make things happen," he said. "It's fair to say he put his foot squarely on the gas pedal."

Much of the coming year is expected to consist of working with City Hall on improving the street grid and infrastructure around the arena.

Construction could start in 2016.

"It takes a long time to get these things vertical," he said.

Times news researcher Carolyn Edds contributed to this report.

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